Nick Dowson – Bad Public-ity

‘They’re both full of drunk and disorderly characters who won’t remember anything in the morning.’

Whilst this is only a bad joke, a confusion of competing understandings of what we mean by public has serious ramifications which mask the real role and activities of institutions. We need to re-examine our understanding of the roles of different actors across society, and our expectations of their responsibilities. This offers a useful lens for looking at and rethinking some of the problems facing society today. Drawing from the work of previous thinkers, I will argue that we need to re-imagine what it means for institutions and organisations to be public. This will offer new – although not easy – ways forwards for the project of building an equal, democratic, and environmentally sustainable society. By insisting on clear criteria for what public means, we can fight back against an appropriation of shared institutions and liberatory ideas for private ends. I will begin by examining what it means for things to be public, before moving on to critique what I describe as a ‘moral division of labour’ in our current economic system. This moral division of labour legitimises the economic system of capitalism, splitting the economy into three sectors: the state (‘public’) sector, the private (corporate) sector, and the third sector (that of charities and NGOs). I will then argue that these divisions, or categorisations, are unhelpful, preventing deeper discussion of organisations’ functions and structures. Rethinking how, and to what, we hold institutions accountable is necessary, as current economic structures are a key cause of great social and environmental destruction. Too much emphasis is placed on financial obligations, at the expense of vital social and environmental ones.

Defining ‘Public’

The word public is often used to describe things – institutions or resources – which belong to the ‘people’ as a whole, in the sense that they are accessible to all and that everyone has a stake in them and a say in matters to do with them; or that they create or comprise a “public good”, with benefits for everyone, rather than individuals. At least, in a normative sense (when talking of what is morally or socially desirable, or imperative), this is what is implied in using the term – and rightly. However, there are many idiosyncratic uses of the word public in practice[i].

The first of these is exemplified in the English and Welsh term ‘public schools’, meaning that they are public only in the sense that they are open to anyone who can pay for them – historically, in other schools entry was restricted by church or trade. In practice, the cost of ‘public schools’ means they are accessible only to a very few. A similar meaning of public can be seen in the word pub (public house), Public Limited Companies (anyone can buy shares in them), and to a lesser extent public transport; although when subsidised this can be much more accessible than travel by private vehicle, in the case of many plane – and train – fares, prices restricts their purchase to the well off.

A second misnomer is the automatic use of ‘public’ to denote state institutions, a usage which stems from an understanding of the state as representing the common interest, or as Engels put it, “the illusory common interest”[ii]. Whilst we should insist that state institutions should be public, their services accessible and their organisation under democratic control, we should be wary of accepting that this is currently the case.

‘Public debt’ is perhaps the most obviously pernicious use of this term: why should we pay for their crisis? Public debt, perhaps more correctly described as government debt, has its roots in borrowing by, at most dubiously, democratic governments where populations have little say in budget choices and where large sums of money are funnelled to private interests – stories of which fill the pages of every Private Eye. This is more than just the huge sums recently ploughed into propping up the banks; it is also the riches transferred to private healthcare providers to build up their capacity[iii], and the diplomatic resources made available to companies who can wine and dine officials of UK Trade and Investment[iv], amongst much else.

This is particularly important once we bear in mind an interesting tradition in social science which has questioned whether states exist in the sense in which we normally think of them[v].

The academic Phillip Abrams suggested instead there exists both:

1) a state-idea, which conceives the state as a unified body representing the common interest, as a public institution and as being the body that can legitimately wield violence

2) a state-system, a number of different institutions, often contradictory and working against each other, which make up what we think of as the state; at the same time, many of these are intertwined with private interests or are part of nexuses of interests and revolving doors such as the military-industrial complex[vi].

Both state-system and state-idea (what anthropologists have sometimes talked about as the state fantasy[vii]) are an integral part of existing relations of power, with the state-idea providing cover for other practices – the actual, and under-examined, state-system.

None of this is to say that institutions and matters of state should not be public: they should. However, all too often, they fail to live up to the criteria needed for them to be considered as such.

The Three Sectors of the Economy

I will now examine what I have termed a ‘moral division of labour’ which plays a key part in underpinning the ‘state-idea’ and justifying the role of the state. However, it is more than that, as this contradictory ideology serves to justify and perpetuate practices across the economy and throughout the ‘private’, ‘public’, and ‘third’ sectors. I will briefly outline how these justifications work.

Private Sector

On the basis of the idea of the state as the common interest, corporations are able to abdicate their wider responsibilities in the name of profit. Both in dominant economic narratives and norms in law (fiduciary responsibility), corporations, making up much of what is known as the ‘private’ sector, should pursue profit at the expense of all else. They should only take heed of, for example, the welfare of employees or their impact on the environment to the extent that it suits that end, or to the extent that they are regulated to do so. In fact, where it is profitable, they will often flaunt regulation[viii]. In some versions of this ideology, corporations serve social purposes best by subordinating all other aims to profit and thereby creating growth; in variations on this, it is government’s job to ensure appropriate regulation and so on, whilst business can get on with being profitable[ix].

Public Sector

Aside from the private sector buck-passing which assumes government will pick up the pieces left by business, government is also hamstrung, ideologically and through international institutions such as the World Trade Organisation, in what it is able to do. Free market and neoliberal ideology means a state drive to leave businesses to their own devices, or to support them through creating new markets, whether in healthcare or in nature[x]. Although this posits the state as a ‘neutral arbiter’, the state is required to create the context for markets if not the markets themselves; and in practice, whether legal or illegal, state support is often key to business success[xi]. The drive for ‘deregulation’ or more accurately marketisation[xii], and for austerity, means that the state is constrained in how far it acts, or provides services, in the public interest. Shrinking the state, it is argued, will allow business to do what it does best, creating benefits through the pursuit of profit. The adoption of a neoliberal ideology prevents the state from serving a public function. Similarly, the top-down structure of state institutions, although ostensibly allowing for control by democratic representatives, tends to prevent both internal democracy and greater participatory public involvement in these organisations. Thus, the public sector is not as public as it needs to be.

The Third Sector

Faced with obstacles in the other sectors to the pursuit of social motives, arguments fall back to the third sector. The third sector – organisations that are neither state organisations, nor for-profit – is used to justify cutting back the state. The charities and NGOs that make up this sector come to represent altruism and society (they are ‘civil society’); most starkly in David Cameron’s ‘big society’. They also have an increasing role in international relations, with representatives in international bodies such as the UN[xiii]. However, turning state organisations into ‘independent’ not-for-profit organisations, or worker-owned companies, can be a surreptitious form of privatisation, as has been seen recently in the NHS[xiv].

The third sector rarely lives up to the ‘public’ character it is perceived as having. Partly this is because this sector tends to act as a sticking plaster for austerity and the wider market system: picking up the pieces, perhaps, but preventing radical change. However, it is more than this. Firstly, with few exceptions[xv], the sector reproduces hierarchical top-down ways of working, and internal inequalities, including in pay. This means they can behave in similar ways to formally profit-making institutions, with the same incentives for directors and managers to prioritise growth and ‘efficiencies’ over other objectives. Secondly, third sector organisations, like organisations in the other sectors, operate within an external context composed of both market relations (with its related drive to economise financially and a pressure to subordinate all other goals to that of financial turnover) and of the pressure to conform to an agenda set from above, via the requirements for funding from state institutions that many NGOs rely on. Thirdly, and in line with an economic system which prioritises output over process, charities are sorely limited in what they are able to do legally. They must prioritise their aims, and not take action for reasons of social responsibility or sustainability that might jeopardise them financially. For example, the law is often, and incorrectly, construed as meaning that charities cannot invest ethically[xvi] . This legally-mandated narrow-mindedness acts as a barrier to the holistic approach which is necessary for radical social change. Means must be appropriate to their ends, and market mechanisms and hierarchical relationships are at the core of the societal problems which the third sector is supposedly trying to alleviate.

Another Institution is Possible

Here I have attempted to sketch out why, despite claims to creating social benefits, structural and ‘moral’ divisions of labour in the economy mean that – on the whole – they are unable to do so. Burgeoning inequality, absence of autonomy in work, and social and environmental destruction are the results. What I have here described as the current ‘moral division of labour’ in the economy is actively harmful, and should be abandoned; unclear and unproductive ideas of the ‘public’ character or the social and moral responsibilities of institutions prevent us from a deeper discussion of the forms and functions of the organisations making up our economy and society.

Should we insist that that all institutions are public? Or that to be genuinely considered public, institutions should be accessible, internally democratic, socially & environmentally-responsible, and have input from the wider public in their decision-making?

Internal hierarchies, and external market relationships, are a large part of the problem. Internal hierarchies result in the activities in all three sectors being organised in the interest of a few, rather than allowing for a debate about what is best for the many. Meanwhile, market relationships encourage ‘lowest common denominator’ policies, with a drive towards ‘efficiencies’ and profit. They inhibit the construction of relationships between organisations which can offer not only solidarity, but also enable the allocation of resources to where they are needed most, constructive criticism and, where appropriate, sanctions against organisations whose practices are creating widespread harm. Market relationships embody instead an attitude whereby cooperation is only forthcoming where there is self-interest in doing so: I will buy/sell a service from/to you, because that is the best option for me; no other considerations come into it. This inevitably leads to inequalities of capital and power. We should argue against both hierarchies and market relationships, and for relations to be built on democracy and solidarity.

On the other hand, I am not arguing for a ‘one-size-fits-all’ model, nor for forced ‘collectivisation’ as so brutally seen in ‘socialist’ Ukraine[xvii]. Autonomy within working life is highly important, and people should be able to choose how they organise, in work and elsewhere. Meanwhile, a pluralistic society is important for preventing authoritarianism and conformity, and allowing people to experiment and be in control of their lives. Freedom of self-organisation is particularly important for historically-oppressed groups, to build their confidence, consciousness and fight against the conditions of oppression.

However, this does not mean individuals and organisations should be free to exploit their employees, ignore the wider effects of their business, or use common resources without wider involvement in decision-making[xviii]. Workers should have the ability to change the way organisations are organised; and all organisations should have in mind their external impacts, regardless of their specific aims and financial circumstances. We also need a wider, participatory, democratic system, going beyond specific organisations, and encompassing a ‘public sphere’ – places where matters of common interest can be debated, free of barriers of status or the institutional constraints which Kant argued prevented the exercise of ‘public reason'[xix].

This is not a purely academic debate. The rules and incentives that constitute collective bodies are (with the exception of social movements and other informal actors) defined by the law, and it is the law that creates much of the framework which empowers and disempowers various actors within organisations. It is also the law which creates the absolute imperative on company directors, charity trustees, and those in charge of quasi-state institutions such as NHS foundation trusts to pursue profit and financial solvency above all else[xx]. These legal mandates and imperatives could, and should, be changed. Creditors can petition for companies, or charities, to be liquidated if they are not paying their debts[xxi]; why not allow companies to be liquidated if they prove to be creating unacceptable social or environmental degradation? Or allow a majority of employees to overturn management decisions or replace management itself, particularly where internal democratic structures are lacking or health and safety breaches are found?

The problems, and the solutions, to societal problems are not in the balance between private, state, and third sectors or in a debate over governmental regulation versus business freedom. Instead, we need to analyse the structures and imperatives on collective organisations across society, and seek to change these, both within and outside the law.

[ix]I recently had the strange experience of watching a presentation from Shell’s VP CO2 (Not only do they now seem to have accepted that climate change exists, they have a worse sense of humour than I do…) give the company’s prognosis for the world, a bleak view of not only environmental disaster but, couched in euphemisms, increasing social catastrophe and market authoritarianism (TINA,as the slide helpfully put it). Shortly after having bragged about Shell’s access to high-level decision-makers, including in the US state department, the man refused to respond when asked about how many deaths from climate change it would take before Shell rethinks its business model. All he would say is that they would act when, and only when, government regulated them.

[xiv]NHS foundation trusts are on example of this. Whilst not-for-profit, ensuring they don’t run a deficit within the increasing ‘internal market’ of the NHS is increasingly making them look like corporations, rather than institutions which put public health at their forefront. See Allyson Pollock, ‘NHS PLC’. Central Surrey Health is another example of this: http://www.theguardian.com/society/patrick-butler-cuts-blog/2011/sep/19/social-enterprise-big-society-gets-reality-check